Lucky Cement Limited (LUCK): 1QFY21 EPS at Rs13.5, up 242% YoY (higher-than-expectations)
- Lucky Cement (LUCK) has reported consolidated earnings of Rs13.5/share, up 242% YoY and 194% QoQ. Earnings are much higher than our expectations of Rs10.0/share.
- Deviation in our earnings stems from higher than expected Gross Margins in (1) Pak cement business at 28% (vs. our expectation of 24%) and (2) Auto business at ~12% (vs. our expectations of 8%).
- Auto business numbers we have extracted by deducting Cement and ICI financials from consolidated business.
- We estimate Net Sales of the Auto business to have clocked in at Rs16bn, up 77% QoQ.
- Pak Cement sales (local + exports) posted growth of 52% QoQ, driven by 35% QoQ higher volumes and higher retention prices.
- Distribution cost increased by 23% QoQ, largely in line with increase in volumetric sales.
ICI Pakistan (LUCK’s listed subsidiary) also recorded a growth of 35% QoQ in its sales, followed by improvement in Gross Margins by 200bps QoQ.
Lucky Cement is a cement manufacturing and distribution company which is based in Pakistan. Co. is engaged in the manufacture and sale of Ordinary Portland, Sulphate Resistant, and Slag Cement. Co.'s brand names included Lucky Cement, Lucky Star, Lucky Gold, Chairman, and Lucky Sulphate Resistant Cement. Co. maintains production facilities in Pezu (Production capacity: 13,000 tons per day) as well as in Karachi (Production capacity: 8,000 tons per day). In addition, Co. is engaged in developing export markets for bulk loose cement from Pakistan to the Gulf Countries, African Markets, and Far East Region including Nepal & Sri Lanka.
Topline Securities is one of the fastest-growing brokerage houses in Pakistan. It has strong Equity Brokerage, Economic/ Equity Research, Commodity Trading and Corporate Finance & Advisory functions.
Topline Securities has been endowed with numerous awards by renowned international financial organizations. The highlights of which consists of the award for ‘Best Local Brokerage House of Pakistan’ by Asiamoney Brokers Poll (the largest Asia-focused equity services provider poll) in 2016 and ‘Best Equity Brokerage House’ by CFA Society Pakistan in 2015.
Previously, Topline Securities held the title for ‘Best Brokerage House’ for 4 consecutive years (2011-2014) by Asiamoney Brokers Poll. Other awards include the ‘Best Salesperson’ award by Asiamoney for 6 consecutive years (2011-2016), the ‘Arabia Fast Growth 500’ award and ‘Pakistan Fast Growth 100’ award in 2012 and 2013 by AllWorld Network.
JCR-VIS, a credit rating agency providing independent rating services in Pakistan has assigned initial rating of “A-2” for short term and “A” for long term to Topline Securities. Topline Securities is registered as Underwriter, Book Runner and Research Entity with Securities & Exchange Commission of Pakistan (SECP).
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